The present study aimed to explore the relationship of sarcopenia, with or without the presence of obesity, with the risk of developing type 2 diabetes. We conducted a cross-sectional analysis of 2981 subjects in the Korean Genome and Epidemiology Study. The diabetes status of each subject was determined by using a 75 g oral glucose tolerance test, and body composition was estimated via dual-energy X-ray absorptiometry. The skeletal muscle mass index (SMI, %) was obtained by calculating the total skeletal muscle mass as a percentage of body weight. In the non-diabetic subjects, the SMI exhibited an independent negative correlation with the homeostasis model assessment of insulin resistance value (P for trend < 0.001). Among subjects of age 60 years or older with pre-diabetes or newly diagnosed diabetes, a substantial increase in the prevalence of sarcopenia (without obesity) and sarcopenic obesity (SO) was observed, as compared to patients with normal glucose tolerance status. Furthermore, the odds ratios (OR) for pre-diabetes and newly diagnosed diabetes were significantly greater for subjects of 60 years or older in the SO group compared to the normal phenotype (neither obesity nor sarcopenia) group, after multiple adjustments (OR = 2.45, 95% CI = 1.813.32), and similarly, the sarcopenia group was at a relatively higher risk for pre-diabetes and newly diagnosed diabetes (OR = 1.62, 95% CI= 1.152.28). These statistical significances were not observed for the middle-aged group of subjects. In conclusion, sarcopenia and SO display strong association with an increased risk of pre-diabetes and newly diagnosed, or early phase diabetes in older Korean adults. These findings suggest that the age-related loss of muscle mass may be an independent risk factor for the progression of pre-diabetes to early phase type 2 diabetes.